Spencer and Benefits NetNews – June 20, 2014

About this Newsletter

The Spencer’s Benefits Reports is a summary of the week’s news items posted
in the WHAT’S NEW pages of Spencer’s Benefits Reports
For questions regarding this email service, contact Customer Service at (800)449-9525.

NetNews Subscription

Want to receive these Newsletters via E-mail?

hr.cch.com Resources

About Links in this Newsletter

To access the IntelliConnect™ full text documents you must be a subscriber
to the Spencer’s Benefits Reports IntelliConnect product
(depending on the link*).

Links within news stories display full text documents including legislation, regulations,
court decisions, rulings and government reports.

The first time you click on a link you will be taken to the IntelliConnect login page, where you will need to enter your ID and password. Subsequent links will take you directly to the desired document.


If you aren’t a subscriber call 800-449-9525, or let us contact you about,

Email Us

Contact us by sending an e-mail to

Featured This Week

New Reports

  • Analysis: HIPAA Rules On Preexisting Conditions, Creditable Coverage, 6/14 (501.-15)

(Read Intelliconnect) »

  • Analysis: HSA Comparability Rules, 6/14 (356.-41)


(Read Intelliconnect) »

  • Summary: Chronological Summary Of HSA Guidance, 6/14 (356.-25)


(Read Intelliconnect) »

  • Survey: 2014 PBGC Interest Rates, 5/14 (619.5.-53)


(Read Intelliconnect) »


June 20, 2014

HSA Balances And Distributions Increase With Age: EBRI

Despite the fact that older individuals use more health care services and take more distributions from their health savings accounts (HSAs), HSA account balances increased with age, according to recent research from the Employee Benefit Research Institute (EBRI). The study,
HSA Balances, Contributions, Distributions, and Other Vital Statistics—A First Look at Data from the EBRI HSA Database on the 10th Anniversary of the HSA, found that individuals under age 25 had an average of $697 in their HSA at the end of 2013, compared with $3,780 among individuals ages 55 to 64. Individuals ages 65 and older had an average HSA balance of $4,460 at the end of 2013…

(Read Intelliconnect) »

Automatic Enrollment And Increases For Nonprofit 403(b) Plans Are On The Rise: PSCA

Nonprofit organizations that sponsor 403(b) plans are increasingly enrolling employees and including annual increases on an automatic basis, according to the sixth annual Plan Sponsor Council of America’s (PSCA) 2014
403(b) Plan Survey. The use of e-mails and webinars to communicate plan information also increased significantly…

(Read Intelliconnect) »

June 19, 2014

Benefits Were 31.2 Percent Of Total Compensation In March 2014, BLS Finds

Employer-provided benefits costs for civilian workers in private industry and state and local governments in March 2014 averaged $9.97 per hour worked, accounting for 31.2 percent of total compensation costs, which averaged $31.93 per hour worked. The cost of benefits as a percentage of compensation has risen in the past three years from 27.4 percent of total compensation. These are among the findings of the March 2014
Employer Costs for Employee Compensation report, produced quarterly by the Bureau of Labor Statistics (BLS)…

(Read Intelliconnect) »

Paying For Risk Corridor Program May Violate Federal Law, Contend Sessions And Upton In Letter To HHS

Department of Health and Human Services (HHS) Secretary Sylvia Burwell received a letter on June 10, 2014 from House Energy and Commerce Committee Chairman Fred Upton (R-MI) and Senate Budget Committee Ranking Member Jeff Sessions (R-AL), informing her that her office may be about to violate federal law. The letter requests an explanation of Burwell’s stance on recent legal analysis by the American Law Division of the Congressional Research Service (CRS), concluding that Sec. 1342 of the Patient Protection and Affordable Care Act (ACA), which directs the HHS Secretary to operate a risk corridor program, fails to specify a source from which risk corridor payments are to be made…

(Read Intelliconnect) »

June 18, 2014

Employee Choice Transition Delayed In 18 States With A Federally-Facilitated SHOP

Small businesses in 18 states will have to wait until 2016 to participate in the employee choice in the small business health options program (SHOP), as only 14 states with federally-facilitated SHOPs will have employee choice available to small businesses in 2015, which was the original timeline. “Employee choice” allows small business employers to give employees the ability to choose any health plan at the “metal” tier the employer chooses—bronze, silver, gold, or platinum…

(Read Intelliconnect) »

Individuals Enrolled In CDHPs Change Behavior To Save Money

Consumer-driven health plans lead to reduced health care costs for employers and employees, but the decrease in health care expenses is attributable to a shift in behavior rather than cost, according to survey results from health services company Cigna…

(Read Intelliconnect) »

New Bill Would Create Health Reform Oversight

Sen. Pat Roberts (R-Kan.), a senior member of the Senate Health, Education, Labor, and Pensions (HELP) Committee and the Senate Finance Committee, has introduced a bill (S.2430) to create a Special Inspector General to oversee the Patient Protection and Affordable Care Act (ACA)…

(Read Intelliconnect) »

June 17, 2014

PBGC Issues July 2014 Interest Rates For Valuing Terminating Pension Plans

For single-employer pension plans terminating July through September 2014, and for multiemployer plans involved in a mass withdrawal, the interest rate established by the PBGC for calculating immediate annuities is 3.43, slightly down from the 3.47 percent rate that applied in April through June 2014. The interest rate for calculating immediate lump sums in July 2014 is 1.25 percent, the same rate that applied in June 2014…

(Read Intelliconnect) »

Employers Interested In Exploring Stricter Rules Around Health Benefits And Reference-Based Pricing As Part Of Their Health Strategy

While employee cost shifting remains the most prevalent technique in employers’ health strategies today, there is growing interest in adopting new health tactics to mitigate cost and improve population health in the future, according to recent research from Aon Hewitt. The
Health Care Survey found that 52 percent of employers said their current health strategy is focused on traditional trend mitigation approaches, such as employee cost shifting. However, just 21 percent said this would be their preferred approach in three-to-five years…

(Read Intelliconnect) »

Supreme Court Declines To Review Decision Allowing Equitable Recoupment Of Benefit Overpayments

The U.S. Supreme Court has denied an ERISA plan beneficiary’s request to clarify whether an ERISA plan could enforce an equitable lien for benefit overpayments where the plan had not identified a fund that was in the possession and control of the plan participant at the time the plan asserted its lien. The High Court also denied a request to hear arguments on whether a plan fiduciary could review and make plan benefit decisions under a discretionary standard where that standard of review had not been disclosed to plan participants. The case is
Thurber v. Aetna life Insurance Co. (Docket No.13-130)…

(Read Intelliconnect) »

June 16, 2014

Federal Interest Rates Announced For Pensions

The following interest rates have been announced for use in the operation and administration of qualified pension plans…

(Read Intelliconnect) »

Majority Of Employers Believe ACA Has Had Negative Impact On Their Company

More than half of single employers believe that the Patient Protection and Affordable Care Act (ACA) has had a negative effect on their company, according to a recent report from the International Foundation of Employee Benefit Plans. Nearly 90 percent of employers expect ACA to increase their company’s health care costs in 2014, resulting in many employees seeing higher out-of-pocket costs and increased premiums and deductibles…

(Read Intelliconnect) »

Former Employee Could Pursue Monetary Relief Via Reformation Of SPDs Distributed When DB plan Was Converted To Cash Balance Plan

A former employee could pursue monetary relief via reformation of allegedly false and misleading summary plan descriptions (SPDs) that he contended only summarized part of a new formula for calculating benefits and did not inform participants that the new formula effectively reduced the rate of future benefit accruals when the employer converted its defined benefit plan to a cash balance plan, according to the Second Circuit U.S. Court of Appeals in
Osberg v. Foot Locker, Inc…

(Read Intelliconnect) »